Kenya will not impose new taxes or raise existing ones in its 2025/2026 budget proposals, the finance minister confirmed, a decision shaped by the deadly youth-led protests that shook the nation in June 2024.

At least 50 people were reported dead following confrontations with security forces during demonstrations that forced President William Ruto to withdraw a controversial tax increase worth 346 billion shillings ($2.68 billion), even though it had already passed through parliament.

Finance Minister John Mbadi made the announcement on Tuesday at a televised meeting, emphasizing that the government’s focus is now on tightening tax administration and improving efficiency rather than raising rates.

“The finance bill doesn’t have to always adjust tax rates upwards,” Mbadi stated, underscoring a shift in approach from last year’s unpopular tax push.

Mbadi explained that the finance bill submitted to parliament this year is centered on sealing loopholes and streamlining tax collection, rather than burdening Kenyans with new financial demands.

The government has also submitted its spending proposals, setting total expenditure at about 4 trillion shillings and targeting a budget deficit of 4.5% of GDP, for debate and approval by the National Assembly.

“There are no new major tax measures,” Mbadi assured, noting that the 2025/26 finance bill is aiming for an additional 25 to 30 billion shillings in revenue, generated largely through administrative improvements.

However, the proposed legislation has drawn criticism over a clause that would grant the tax authority access to the financial records of businesses and individuals, a move designed to uncover tax evasion.

Critics argue that such access could infringe on privacy rights, but Mbadi defended the plan, saying it is necessary to ensure fairness in tax collection.

“There are so many people out there operating big bank accounts and they cannot pay tax simply because they are protected by these kinds of mischievous laws,” Mbadi said, insisting that the government must have the tools to hold wealthy individuals accountable for their tax obligations.

The finance bill and budget proposals now await parliamentary review, a crucial step before the official budget presentation expected next month.

The government’s approach reflects an effort to avoid the widespread anger and unrest that erupted over last year’s tax plans, signaling a more cautious fiscal path for East Africa’s largest economy.